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Asian gold closes higher but sentiment seen weak

HONG KONG: Asian spot gold closed higher on Thursday on short-covering after prices fell in New York overnight, but bearish sentiment could lead gold below US$278 levels.

Bullion ended at US$277.20/70 an ounce, up from New York's US$276.00/50 close on Wednesday. It opened here at US$276.40/90.

"There was some short-covering, but gold traded in a tight range and there was not much interest," said a dealer at a local securities house. "Light physical buying also pushed the price higher."

"Gold looks a bit weak, but I think we will also have bargain-gunting and I prefer to buy on the dip," the dealer added. "The downside support is seen at US$275 levels."

Spot silver ended at US$4.94/97 an ounce after closing in New York at US$4.94/96 on Wednesday

Local gold ended HK$14 lower at HK$2,578 a tael.

The carry over charge at the Chinese Gold and Silver Exchange Society dropped to-5.00 from its previous fix at-4.00.-Reuters